ARM investors can now make claims against failed financial advisers

15th October 2015

FSCS has received new evidence from claimants and other third parties relating to investments in bonds backed by ARM Asset Backed Securities SA (ARM bonds). In light of this evidence, we believe some ARM investors can now make successful claims against failed financial advisers if negligent advice can be proven.

Since early 2014 we have been working through claims against Catalyst Investment Group Limited in relation to its role in promoting ARM bonds. We have paid compensation for around 3,700 claims.

Before we looked at claims against Catalyst we considered whether failed independent financial advisers were liable for losses due to negligent advice to invest in ARM bonds. We found that failed financial advisers were liable under very limited circumstances. As a result, a number of these claims were unsuccessful. Many of these claims related to advice given by Rockingham Independent Limited which we declared in default in 2012.

We have now revisited these claims and identified around 70 which may now be due compensation. In particular, the 70 claims we have identified have shown evidence that financial advisers failed to act on information they had at relevant times about the authorisation status of ARM. We will contact these people by the end of this month to confirm that we are reconsidering their claim. We will also contact the remaining customers with insufficient evidence to support their claim to confirm that our original decision to reject their claim still stands. We are not reassessing claims where the claimant has already been fully compensated up to the FSCS investment limit of £50,000, e.g. from a successful claim against Catalyst.

If you have not made a claim to us yet, you can request an application form by contacting our Customer Services Team on Freephone 0800 678 1100 or 020 7741 4100.